German drug and chemical maker Merck says it plans to shut the Swiss headquarters of its Merck Serono pharmaceutical division, cutting more than 500 jobs.

Merck said on Tuesday in a statement that it plans to transfer more than 750 of the 1,250 positions at Serono's Geneva headquarters to other Merck sites. It said it expects to cut the other 500 jobs in Geneva and another 80 at Swiss manufacturing sites "to create a leaner, more agile organization."

The move is part of a wider efficiency program that Merck, based in Darmstadt, Germany, launched in February.

The company said that, after consulting with employees, it aims to start implementing the relocations and job cuts in Switzerland in the second half of this year. Research and development positions will be moved to Germany, Boston and Beijing.

The Geneva authorities were told of Merck's plans on Monday and the employees were informed on Tuesday morning. The cantonal government is not planning to offer tax breaks to encourage Merck to reverse its decision.

Merck said that production units in Aubonne, Corsier-sur-Vevey and Coinsins in canton Vaud would be maintained although around 80 positions would be lost. More than 130 technical specialists from Geneva will also be transferred to those sites.

The German firm added that its Swiss commercial operations based in Zug were not affected by the job cuts.

Merck bought Serono from the Bertarelli family in 2006 for SFr16 billion ($17.5 billion). Last year, it generated €5.6 billion (SFr6.7 billion), or 60 per cent of Merck’s turnover.

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